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Web 2.0-Online communities, Personalization and the Web
Sunil Singh
Monday, November 17, 2008
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It was just about a year ago that I had talked about the emergence of Web 2.0—which I had referred to as the “connectedness, collaboration and the social internet.” A year later, as I look at the landscape, I am even more certain that those themes remain the cornerstone of innovation in Consumer Internet today.

Today the major themes of Web 2.0 continue to be dominated by the following:

Social Networks
Online communities emphasizing the notion of more sharing and connectivity on the Internet, but also with a strong focus on personalization.

The emergence of User generated content becoming a powerful force—both as a “content generator” as well as a “collective wisdom” tool. Tagging, which is the categorization of sites by users using their own keywords, is now widely recognized as a legitimate categorization (“folksonomy” as opposed to the more rigorous “taxonomy”). Yahoo acquired the premier tagging site deli.cio.us recently.

Perhaps the best example of the enormous impact of an online social network is the tremendous popularity of MySpace.com. What started out as a site for sharing “indie” music in the US, soon became a national teen phenomena, with high schoolers building and personalizing their own web pages, inviting friends into their network, sharing and talking about common interests and aspirations and truly demonstrating the power of viral marketing. Today MySpace continues to be a powerful magnet for teenagers, with nearly 40 million users, leading to its purchase last year by News Corp. for $580 Million. This has also exposed a slightly troubling facet of such sites. Teenagers, if left unchecked, are likely to be exposed to some of the seamier aspects of the Internet on these sites.

The success of MySpace (www.Myspace.com) has led to a mushrooming of other social networks, with more focused niches. Facebook (www.Facebook.com) is a social network catering strictly to college students, and has grown at a meteoric pace. In retrospect, it seems somewhat obvious that college kids would like to “hang out” at a site where they are guaranteed to find more of their own kind. The site reportedly has 12-15 million Users, and is said to be valued at between $1-2 Billion (it is also said to have turned down an offer of $750M). The space has attracted the attention of other venture capital groups, with other social networking sites attracting large investments. The premise in all these continues to be the belief that segmenting sites in specific demographics or verticalizing along interests will attract a nucleus of users. Thus Tagged (for younger people), Bebo (www.bebo.com) (primarily British and Irish people) and Friendster (www.friendster.com) have all attracted large investments.

Casual Gaming
An equally interesting phenomenon in the Web 2.0 world is the emerging space of “online casual gaming.” Historically, computer-based gaming has always been seen as a domain of “hardcore gamers”—the first few Games that merged the concept of online communities with a gaming experience certainly reinforced this notion—games such as Habbo Hotel (www.habbo.com) and Runescape (www.runescape.com) demonstrated the stickiness of these Massively MultiPlayer Online Role-Playing Games (MMORPGs). However, the more interesting phenomenon is the tremendous popularity of “casual gaming.” These are simple games, such as Card, Board or Puzzle games, and have attracted wide interest from demographics such as women between the ages of 25-35 and older people (greater than 50 years). Recognizing the tremendous potential online advertising dollars locked within these demographics, a number of games companies have now begun to take this very seriously. Yahoo already has a major casual games initiative in “Yahoo Games.” Electronic Arts acquired Pogo, Real acquired Zylom, Disney has launched Game Café, MSN has launched an online game arcade and there are a number of new start-ups in this area. These include Boonty (www.boontygames.com), Oberon (www.oberongames.com) and Big Fish (www.bigfishgames.com).

The most innovative aspect of the Web 2.0 casual gaming phenomena is the fact that for the first time there is a potential to marry gaming, user generated game content and the power of Internet distribution. The company that best exemplifies this unique innovation is a Palo Alto start-up called BunchBall (www.bunchball.com). It offers Flash-based single and multi-player casual games (such as Tetris and Hexxagon). It also offers an Open API for independent developers to write their own games and deploy them on the BunchBall platform. A concept of “widgetizing” the game allows any individual to create a “blog widget” of any game which can then be embedded in their blog, allowing all visitors to the blog to play at that site. This paradigm shift of “play anywhere” instead of at any given site could radically shift the thinking behind “building communities” or “carrying the community with you.”

An interesting corollary of the emergence of “personal web sites”, and user generated content is the concept of Virtual worlds. Users can create custom items (clothes, cars, houses) and lead to a thriving “virtual world economy” (with real financial transactions). Two examples of these are Meez (www.meez.com) where users can create a 3D avatar, dress it up, change its background and animate it, then “export” a picture of it to use elsewhere (e.g. web sites or blogs). Premium clothes etc. can be purchased with real money at Beenz. Similarly, Palo Alto based IMVU (www.imvu.com) which makes a 3D instant messenger. The service lets users express themselves by creating and customizing a 3D avatar with a wide variety of clothes, accessories, pets, and scenes. The service generates revenue from the sale of virtual currency Another example is Hive7 (www.hive7.com) where users can create a room and decorate it with objects, static like trees and rugs, rich media like video and picture viewers and dynamic like dice that roll. They can navigate between rooms and chat with the other people in the room.

Finally, a discussion of the Web 2.0 world would be incomplete without an interesting direction, primarily driven by the “Google vision” of “the browser is the only operating system.” Productivity tools like Word processors, calendaring, spreadsheets etc…must be created for the browser if this vision is to become a reality. We have already seen a host of start-ups in these spaces. Writely (www.writely.com) created an impressive word processor and was quickly acquired by Google. There are a few online calendaring companies around, such as Calendar Hub (www.calendarhub.com) and Kiko (www.kiko.com). An interesting online spreadsheet is NumSum (www.numsum.com). In the coming months, I expect to see a bunch of desktop tools like these being developed for the Web.

The future of Web 2.0 continues to be an exciting one.

Sunil Singh is the CEO of Informance.
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